[March 01, 2014]NEW YORK (Reuters) - The
Securities and Exchange Commission has launched a probe
into how Wall Street banks, including Goldman Sachs
Group Inc and Citigroup Inc, allocate and trade
corporate bonds, the Wall Street Journal reported on
Friday.

The SEC is examining whether banks favor big
investors, leaving smaller ones at a disadvantage, the newspaper
said, citing unidentified people familiar with the matter.

The regulator has made requests about several deals, including
Verizon Communications Inc's $49 billion bond offering last
year, the Journal said.

Representatives of the banks declined to comment. SEC officials
did not immediately respond to requests for comment.

News of the SEC probe followed a disclosure by Goldman Sachs on
Friday morning that a regulator was looking into its
"allocations of and trading in fixed-income securities," as well
as its financial advisory services.

In the prior quarter, the bank's long list of regulatory
investigations, reviews and litigation into matters ranging from
the municipal-bond market to insider trading did not include
those terms.

Goldman also lowered its estimate of legal losses it may face
beyond what it has set aside to $3.6 billion from a previous
estimate of $4 billion.

(Reporting by Lauren Tara LaCapra in
New York; Additional reporting by Sarah N. Lynch in Washington;
Editing by David Gregorio and Jonathan Oatis)